Senate Revises Digital Asset Market Clarity Act with New Stablecoin Provisions

The U.S. Senate has introduced revisions to the Digital Asset Market Clarity Act, focusing on stablecoin yield provisions. According to BlockBeats, the updated language was unveiled by Senators Angela Alsobrooks and Thom Tillis last Friday. Industry insiders attending a closed-door review session on Capitol Hill expressed concerns that the language is too narrow and lacks clarity. The new provisions aim to prohibit earnings solely from holding stablecoins and restrict practices equating these earnings with bank deposits. Further limitations are set on other potentially permissible activities, though the mechanism for activity-based stablecoin rewards remains undefined. This compromise stems from lobbying efforts between the crypto and banking sectors. The banking industry argues that stablecoin rewards should not resemble interest-bearing bank deposits, as such products could harm banks and suppress lending. The compromise allows for reward programs based on user activity with stablecoins but prohibits balance-based rewards. The closed-door review is part of efforts to prompt the Senate Banking Committee to schedule a hearing, a crucial step toward a full Senate vote. A similar version of the Clarity Act passed the House last year, and another version cleared the Senate Agriculture Committee's markup process. However, the bill faces additional hurdles, including the need for consensus on a DeFi regulatory framework. Democrats also insist on including provisions to prevent senior government officials from profiting personally from the crypto industry, a clause seemingly targeting U.S. President Donald Trump.